The ABARES report found that more investment is needed in Australia's road network, if it's to increase production and exports to Asia.

Carl Curtain

Australia will need to invest significantly more in transport infrastructure if it wants to supply booming food demand in Asia.

That's the message in a report from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), which looks at the capacity of Australia's road network to cope with increased production.

The preliminary economic assessment of Australia's food infrastructure focuses on the five commodities expected to lead the export charge into Asia: beef, sheep meat, dairy, wheat and sugar. It's the second in a series of reports looking at how Australia can be strategic in taking advantage of the Asia food boom. It points the way for further investigation into how much additional investment is required, and how much that could yield in increased exports.

The report finds that existing problems around road bottlenecks and poor maintenance will only get worse as demand and production grow, unless investment is increased.

The head of ABARES's farm analysis, productivity and social sciences branch, Peter Gooday, says it's likely the private sector will have to share more of those costs in the future.

"That could be any number of people in the private sector looking to make a profit from investing in infrastructure, and there are a number of different ways that could be organised.

"One of the things we'll be looking at in the next set of work [due at the ABARES outlook conference in March] will be what the incentives or disincentives are at the moment for the private sector to become involved in public private partnerships, to get more funding into infrastructure," Mr Gooday said.

"The issue really comes about in the next several decades.

"If we're wanting to take advantage of this opportunity of expanding markets in Asia, then we will need more investment in infrastructure so that the bottlenecks that are there and apparent at the moment don't become significant problems."

This preliminary ABARES assessment focuses on road infrastructure, and investment in roads formed the centrepiece of the federal Coalition's infrastructure pitch to voters before the election.

The Federal Agriculture Minister Barnaby Joyce says that shows the government's focus is right, but it doesn't mean rail has been forgotten.

"There's a whole range of investments in rail infrastructure that are ongoing and there's special projects such as the Inland Rail between Brisbane and Melbourne, which in the forward estimates [over the coming four years] will have $300 million put towards that," he said.

Mr Joyce says the Federal Government will manage the budget in such a way that it can afford to invest in export infrastructure, and that government investment will help attract private money.

"A lot of this will have the capacity to attract funds into it, because the rail network would actually make substantial money," he said.

ABARES's Mr Gooday says this report didn't specifically look into rail capacity, but that it notes that wheatbelt infrastructure is set up to cope with the peaks and troughs that come with good and bad seasons.

"We'd probably be in not a bad position in an average season if we were to start producing more grain," he said.

"It's those peak seasons where, if we increase productivity and production, we'll probably need to invest more in the road network, or the rail network, or both, if we're going to cope with those peak seasons.

"One of the things that's apparent at the moment, in terms of the road network, is that there seems to be an issue with funding for maintenance of rural roads.

"It's reasonably obvious that parts of the local road network have not been maintained adequately, and we're talking about hoping to produce more food to export to these expanding markets, and a lot of the time we'll be putting more traffic on roads that aren't maintained well enough at the moment, in areas that have a declining population base, and therefore declining funding base.

"That needs to be sorted out [because] if things come off the rail network, they end up on the road network. So one way or another, we need to find the funding to get the supply chains operating efficiently."